BM Desk : The proposed budget for the upcoming fiscal year 2025-26 includes several tax incentives aimed at revitalizing the struggling stock market of the country. These incentives consist of widening the tax rate disparity between listed and unlisted companies, lowering the withholding tax on transactions conducted by brokerage houses, and decreasing the tax rate applicable to merchant bank income.
Financial Advisor Dr. Salehuddin Ahmed shared this information during his televised budget address on Monday (June 2). He remarked, “The government is implementing various initiatives to rejuvenate the nation’s stock market, which has been severely impacted by the previous government’s irregularities, manipulation, and corruption.”
Additionally, the Financial Advisor noted that several significant measures have been introduced to enhance transparency and restore confidence in the market, including:
– Reducing government ownership in multinational corporations and facilitating their listing on the stock market;
– Encouraging major domestic firms to enter the stock market;
– Implementing practical action plans promptly to curb manipulation;
– Enforcing strict legal measures against individuals involved in irregularities;
– Decreasing reliance on bank loans while expanding opportunities for raising capital through bonds and equities in the stock market.
Evidence of heightened awareness regarding stock market reforms at the highest levels of government was evident in a meeting held on May 11, where the Chief Advisor to the interim government, Dr. Muhammad Yunus, issued five key directives. These directives included:
1. Expedite the listing of multinational companies on the stock market;
2. Offer incentives to attract promising domestic firms to the market;
3. Initiate the reform process within three months by engaging foreign experts;
4. Take swift action against those involved in corruption and irregularities;
5. Motivate large companies to secure funding from the stock market rather than relying on bank loans.
The Chief Advisor’s directives were echoed in the Financial Advisor’s budget speech.
